How the Chinese slowdown affects Central Asia

By Dmitriy Belyanin

Introduction

By gradually converting to a market structure, China has become the second largest economy, buoyed by the world’s largest population, low labor costs, a weak currency, and lax environmental regulations.  Its slowdown, which began in 2014, retards the global economy, particularly nations that sell it oil.  In Kazakhstan, the drop in global oil prices weakened the tenge on the street, leading the National Bank to begin floating the currency in August 2015. 

Other Central Asian countries also suffer from the Chinese slowdown, but to varying degrees. Uzbekistan and Turkmenistan export less cotton and natural gas than they would have otherwise.  But remittance-dependent Tajikistan lost more from the recession in Russia, which destroyed migrant jobs.  Kyrgyzstan is hampered mostly by a drop in exports to Kazakhstan, due to tenge depreciation.

Causes and dynamics of the economic slowdown in China

Some Communist and socialist parties still portray China as a successful Marxist economy.  The first adjective is in less dispute than the second.  In 2003-7, output (measured as real gross domestic product) grew more than 10% per year.  Miraculously, both unemployment and inflation have remained below 5% (except in 2007, when inflation reached 6.5%), according to the October 2015 World Economic Outlook Database.

Exports drove the growth, accounting for 36% of China’s GDP in 2006.   Low wages enable exporters to lower their prices.  Some factories pay workers just a bit more than the minimum wage, which averages $270 a month, less than one-fourth of that of the United States.  Labor productivity in China rose by 11% from 2007 till 2012, which compares well with some of the younger tigers (8% in Thailand and 7% in Indonesia).  This surge in output per worker is all the more remarkable because most labor in China is not still automated. The country has only 30 robots per 10,000 manufacturing workers, as compared with 323 in Japan. With its productive, cheap labor, China remains competitive in low-end production; its share of global clothing exports rose from 42.6% in 2011 to 43.1% in 2013.  And its tax breaks, cheap land, and infrastructure attract investors who can finance its entry into high-end markets.

But aging, rising expectations of workers, and a slowdown in migration to the cities place China at a disadvantage.  It must compete with countries that have young workers who settle for low pay.  The age of the workforce of Southeast Asia averages below 29.5; and the average factory worker’s salary of $27.5 per day in China is well above $8.60 in Indonesia and $6.70 in Vietnam, reports the Economist.

One cause of Chinese aging is the one-child policy that the government established in the late 1970s; the typical couple could raise only one child.  Recognizing that this sharp fall in births raises the average age, China relaxed its policy last October to two kids rather than one.  Even so, the population is to fall by 2030.  Today, a tenth of the population is 65 or older, and the share is to rise to 20% by 2035, reports Chris Buckley of the New York Times.

China must also cope with lethal pollution.  Around 300 Chinese cities grossly failed air quality inspections in 2005.  Over 1.6 million Chinese die per year from toxic air. Pollution costs equal 6.5% of the value of annual production (measured as GDP), according to a US think tank, the RAND Corporation.  A fifth of China's soil is poisoned. 

The government does fight pollution, in moderation.  It closed 2,500 small firms in Beijing and restricted the use of coal.  It plans to improve air quality 10% by 2017, reports Constance Gustke, of CNBC.  This won’t be cheap.

Thanks to overproduction, overpopulation and pollution, the government encourages some enterprises to go abroad.  In 2013, the State Council of China called for six leading industrial provinces to cut steel production by 80 million tons. In 2013, 214 Chinese workers went to Africa to build roads, bridges, dams and power plants – a fourth of all workers going abroad for state enterprises.  Countries in the Eurasian Economic Union, particularly Kazakhstan, may also host Chinese enterprises, since they raised tariffs on Chinese exports, reports Tatiana Kaukenova of Radiotochka. Chinese firms would come to Eurasia because they can sell at a lower price by producing in the hosts than by exporting to them over the tariff barrier.

Currency policy

The most visible sign of change in China’s economy is its freeing of the exchange rate. China had two exchange rates -- an official one used by the government, and a market-based one used in foreign trade – until it unified them in 1994. China's central bank, the People’s Bank, continued to undervalue the yuan, boosting exports and holding down the dollar cost of labor, but it has strengthened it periodically except when this was politically inopportune – for example, just before the G20 summit in Toronto in 2010.  As economic growth has tapered in the last few years, China has slowed appreciation. But the renminbi remains undervalued, given the fundamentals of the Chinese economy, writes Brendan Murray of Bloomberg.

To some extent, the yuan is a victim of the West. When the US Federal Reserve cut back on its easy-money policy (quantitative easing), the dollar became more scarce and valuable.  So it strengthened – and currencies in developing countries weakened by comparison.   China was no exception.  Over 2014, the yuan depreciated until August, then rose.  The People’s Bank devalued it last August to 6.39 per dollar, prompting the National Bank of Kazakhstan to let the tenge dive -- and allegedly braking the global economy. In January, China devalued the yuan again, to 6.53, reported Calum MacLeod of The Times of London.  

China’s repeated devaluations threaten to launch a beggar-thy-neighbor war that could destabilize the Third World.  China has hefty international reserves, so if it errs with an excessive devaluation, it can easily undo it by selling dollars for yuan. But many more-indebted countries have few dollars stashed away. If they go out on a limb by weakening their currencies too much, then they may have to absorb the collateral damage, especially inflation.

On the other hand, the yuan may strengthen again in the months to come, since China has persuaded the International Monetary Fund to include it in the basket of currencies that determines the value of the Special Drawing Right, which the IMF uses in deals with its 188 member countries.  In October the yuan will join the dollar, the euro, the yen and the pound sterling in the basket, comprising 11% of it. This signals that the yuan is worth holding as a reserve currency.  China qualified for the basket because it is one of the largest exporters and because people use the yuan everywhere.

As a reserve currency, the yuan may enable depositors to diversify risks, once banks begin to accept deposits in the Chinese currency.  This is vital for Central Asia, which lacks well-developed securities markets.  To encourage Kazakh depositors to seize this opportunity, the National Bank should not set the interest rate on yuan deposits too low.

In the long run, to sustain the Yuan’s new status, the People's Bank needs a reasonable monetary policy. The Bank would no longer peg the yuan to the dollar, or to any other currency, in hopes of avoiding fluctuations.  But in the short run, China may justify devaluations as a way to restore economic growth, at the cost of competing with its neighbors. We neighbors must adjust. 

And so must China.  Historically, its exports to Central Asia were seen as inferior.  Now it must improve its exports – or at least their reputation -- since it will lose the low-price market to Vietnam and other emerging economies in Southeast Asia. 

Chinese measures to pep up its economy

If the yuan strengthens for long enough, Chinese exports and output may fall. Can Chinese government offset this risk by encouraging spending?  The real challenge is to spur demand for industrial goods: Although retail sales are up 11.2% since last year, industrial output rose only 6.2% -- almost a crawl compared to China’s usual pace.

In fiscal policy, China has launched a broad-based attack.  The government spent 25.9% more in November than it had a year earlier, reaching 1.61 trillion yuan ($248 billion). It’s flirting with a deficit, since government revenues rose only 11.4%, to 1.11 trillion yuan.  The government also subsidized new technologies and equipment in industry and agriculture.  It intends to cut taxes and social security contributions.  And it might abolish the benchmark rates for deposits and loans, allowing actual rates to move freely, according to the Bloomberg News. 

The government also plans to invest 1.65 trillion yuan ($254 billion) in road construction and 800 billion yuan ($123 billion) in new railways.   The annual growth rate of spending on research and development will rise to 2.5%, from 2%.  And Beijing  will launch projects in space exploration, aero-engine production, robotics, hydropower, nuclear power, rail transit, and underground pipelines, reports the Shanghai Daily.

By signaling its determination to stimulate the economy, the government may pave the road to recovery.  By the end of March, manufacturing was improving, judging from the Purchasing Managers’ Index (PMI), which tracks new orders, inventory levels, production, supplier deliveries, and the employment environment.  A PMI over 50 signals expansion.  It was 50.2 for March, breaking 50 for the first time since July, reports CNBC.   

Economic slowdown and instability in Central Asia

Meanwhile, Central Asia stagnates.  During 2015, all five of the region’s economies slowed in growth.  Perversely, inflation rose in Kazakhstan and Tajikistan, estimated the IMF World Economic Outlook Database.  Normally, when a lack of demand pulls down an economy, inflation will fall because buyers are no longer pushing up prices.

The region’s ailing economies have eviscerated its currencies. The National Bank of Kazakhstan defended the tenge until last August, when the introduction of a floating exchange rate cut the foreign purchasing power of a tenge substantially (given prices) virtually overnight.  In January 2015, the central bank of Turkmenistan devalued the manat sharply, raising its exchange rate for a dollar from 2.85 to 3.5, or 23%, reported Novosti Turkmenistana. Since China is one of Turkmenistan’s largest trading partners, its deceleration undoubtedly influenced the Turkmen central bank. In other Central Asian economies, currencies were more stable, but the tenge depreciation may reduce their exports.  Table 1 illustrates exchange rate dynamics for the yuan and the Central Asian currencies for 2014-2016.

Month	Chinese Yuan	Kazakhstani Tenge	Uzbek Soum	Kyrgyz Som	Turkmen Manat	Tajik Somoni
Jan-14	6.09816	152.942	2 197.15	49.2423	2.85	4.77457
Feb-14	6.10752	171.105	2 212.56	51.302	2.85	4.80128
Mar-14	6.14248	180.393	2 238.53	51.642	2.85	4.80391
Apr-14	6.16912	180.078	2 266.40	53.7062	2.85	4.83396
May-14	6.1633	180.435	2 278.76	52.521	2.85	4.90606
Jun-14	6.15735	181.432	2 294.68	52.1801	2.85	4.91888
Jul-14	6.16672	181.454	2 316.23	51.8354	2.85	4.94661
Aug-14	6.15638	180.129	2 335.99	52.0878	2.85	4.97668
Sep-14	6.14947	179.817	2 350.24	53.8382	2.85	4.98467
Oct-14	6.13762	179.323	2 360.42	54.7212	2.85	4.99676
Nov-14	6.13916	178.722	2 381.60	56.9327	2.85	5.04403
Dec-14	6.12971	180.405	2 399.16	57.9919	2.85	5.16669
Jan-15	6.13151	181.552	2 410.97	58.93	3.5	5.3117
Feb-15	6.14348	182.734	2 442.40	60.7978	3.5	5.4067
Mar-15	6.13209	182.924	2 447.52	61.9683	3.5	5.54586
Apr-15	6.09466	183.198	2 481.17	63.0785	3.5	6.02467
May-15	6.08405	183.933	2 492.16	58.949	3.5	6.27633
Jun-15	6.09098	183.637	2 526.83	59.7998	3.5	6.26108
Jul-15	6.09421	184.618	2 548.84	62.1186	3.5	6.2597
Aug-15	6.32329	206.412	2 573.20	62.4082	3.5	6.27105
Sep-15	6.35854	259.027	2 585.13	67.6557	3.5	6.35841
Oct-15	6.34162	273.852	2 615.55	68.8859	3.5	6.53246
Nov-15	6.36199	300.391	2 698.01	72.1299	3.5	6.65341
Dec-15	6.44807	321.151	2 760.55	75.8417	3.5	6.84923
Jan-16	6.56679	359.982	2 799.01	75.8746	3.5	7.36535
Feb-16	6.54857	356.232	2 828.90	74.7417	3.5	7.85712
Mar-16	6.50364	342.68	2 843.13	72.1511	3.5	7.8691

Source: OANDA Historical Exchange Rates* 

Table 1: Monthly average exchange rates of the yuan and the Central Asian currencies to the dollar, from January 2014 through March 2016

*OANDA is an internet subsidiary of Olsen & Associates, a Zurich-based financial firm.

Though falling oil prices and the Russian recession weakened the tenge, the yuan devaluation must have played a starring role as well.  But China’s share of Kazakhstan’s exports is small as a share of Kazakh trade volume -- 11% for the first half of 2015.  The corresponding figures for the European Union and the Eurasian Economic Union were 56% and 10%, according to Kaznex Invest.

When China devalued the yuan, people expected it to import less oil than before.  But in fact, oil imports for the first 10 months of 2015 increased 8.9%, to 275 million metric tons.  In October 2015, oil imports were 8.8% lower than in September but higher than in the previous October, reported Alex Brog and Kathleen Tanzy, of Platt. Even in February 2016, oil imports were a fourth higher than in the prior February, said Jenny Hsu of Market Watch. Meanwhile, oil prices – and the tenge – kept falling for much of the period.

Natural gas, a key export of Uzbekistan and Turkmenistan, was another story.  Chinese imports fell 3.7% to 12.8 million tons, year on year during the first eight months of 2015. Demand for foreign gas fell because of a mild winter, cheap oil, and a slight rise in Chinese extraction of gas, according to Xieli Lee of ICIS.   

Exporters of cotton from Uzbekistan, Turkmenistan and Tajikistan were also unlucky. Chinese imports halved in October 2015, compared with the prior October.  And imports for August 2015 to August 2016 may drop by a third, from 1.8 million tons to 1.2 million tons, reported Bloomberg. 

Since remittances, mainly from Russia, are nearly half of Tajikistan’s GDP, the Chinese slowdown may not affect the region’s poorest country so severely.  More worrying is Chinese competition: In exporting aluminum, Tajikistan must vie with the country that supplies half of the world’s supply of that metal, at the lowest prices since the global financial crisis began, reported ProFinance Service.

China’s relationship with Kyrgyzstan is also lopsided – and the lop is growing.  China sells 61% of Kyrgyzstan’s imports, but only 2% of its own imports come from the Kyrgyzstanis.  Both Kyrgyzstan’s imports from China and Kyrgyzstan’s exports to China rose sharply over 2015, by 86% and 109% respectively, said the Kyrgyz Ministry of Economy.  But depreciations of the ruble and the tenge hinder Kyrgyz producers in competing for China’s business – and the low-income country suffers from the sharp elbows of its Central Asian neighbors. The “Khorgos” market on the Chinese-Kazakhstani border, in a free trade zone, enables Kazakhstanis to import from China cheaply and re-export at profit to Kyrgyzstan.  Such keen competition may help explain why Kyrgyzstanis go bankrupt in such food markets as poultry, butter, rice and flour.  According to the Kyrgyz National Committee on Statistics, the country exported $1.3 billion of goods in 2015 -- but imported $3.7 billion, with a rise likely this year. 

The picture for Kyrgyzstan is not all bleak. Inflation did fall from 10.5% in 2014 to 10.1% in 2015, said the IMF.  The increase in 2014 inflation from its lowest recent rate of 4%, in 2013, stemmed from depreciation of the som from 49.2 per dollar at the end of 2013 to 58 a year later, a rise of 18%.  Depreciation was even higher in 2015 -- the som was 75.8 in December; but the tailspin in national demand, due to reduced remittances from Russia, may have snipped away at inflation.  The same could be said of Uzbekistan.

Compared to resource-dependent Kazakhstan, Kyrgyzstan is much more self-sufficient in textile and agricultural production, and it is much less affected by events in China.  As for Uzbekistan, official inflation has been slowing since 2011, despite currency depreciation.  Since the central bank controls the official exchange, the relationship between inflation and exchange rates there may be atypical.  Having a relatively closed economy, Uzbekistan may have been less affected by increases in import prices due to depreciation of its soum.  Weakening of the ruble and tenge made Uzbekistani imports much cheaper.

Tables 2 and 3 illustrate the dynamics of real GDP and inflation for China and the five Central Asian countries for 2013-2016, including projections and forecasts.

Country	2013	2014	2015P	2016F
China	7.685	7.300	6.813	6.300
Kazakhstan	6.000	4.300	1.501	2.355
Kyrgyz Republic	10.534	3.603	1.996	3.636
Tajikistan	7.400	6.700	3.000	3.400
Turkmenistan	10.193	10.322	8.522	8.869
Uzbekistan	8.000	8.100	6.800	7.000

P- projected, F-forecasted

Source: IMF October 2015 World Economic Outlook Database

Table 2: Dynamics of real GDP growth in China and Central Asia, % (2013-2016)

Country	2013	2014	2015P	2016F
China	2.500	1.500	1.800	1.800
Kazakhstan	4.800	7.430	9.000	8.000
Kyrgyz Republic	3.970	10.475	10.067	7.781
Tajikistan	3.707	7.360	11.694	6.507
Turkmenistan	4.002	4.228	4.681	7.300
Uzbekistan	10.238	9.809	9.066	9.535

P- projected, F-forecasted

Source: IMF October 2015 World Economic Outlook Database

Table 3: Dynamics of inflation in China and Central Asia, % (2013-2016)

Consequences of China’s anti-crisis measures

China’s anti-crisis measures should help other countries as well.  The New Silk Road can improve its trade with partners and benefit Central Asia, including countries not on this trading route.  But the benefits of the Chinese policy are limited.

First, it deals mainly with the short run – but China’s economic woes in the long run are even more severe.  To overcome the dilemma of an aging population, the two-child policy may require decades.  

Second, acceleration of economic growth in China is not a panacea for Central Asia. It would spur the region’s economies, but it would not raise singlehandedly the prices of oil, natural gas and cotton to their pre-crisis levels. Many other factors would figure in -- the effects of sanctions relief on Iran, the smuggling of oil by ISIL, the recession in Russia, and the disruption of trade due to Russian embargos on the European Union and Turkey.   Agreements by oil exporting countries to restrict crude extraction will not restore the initial prices of petroleum since the pacts cannot be enforced.  Central Asian economies must diversify.

Third, economic growth incurs costs. Even if China enforces measures to reduce pollution, they probably won’t work.  Remnants of Communist ideology make unlikely such market policies as transferable permits.  (In this approach, polluters buy permits from firms that that can avoid pollution cheaply, thus lowering the overall cost of abatement.)  But China will use more natural gas, a clean fuel replacing coal and oil – good news for Turkmenistan and Uzbekistan, if not for Kazakhstan.

The overall effect on Kazakhstan of China’s anti-crisis policy is ambiguous. Consider the relocation of Chinese enterprises to Kazakhstan. This may benefit Chinese manufacturers, since weakening of the tenge cuts the yuan value of salaries.  But the effects of the relocation on Kazakhstan are mixed: It will diversify the economy but increase pollution.  Most Kazakhstanis will accept the new environmental conditions, since the country is too small to argue with China.  Protests probably will not be massive enough to change policy – unless the land-lease furor of the past few weeks is a harbinger.

In the long run, increases in manufacturing exports may enable Kazakhstan to rely less on farm exports and thus to diversify. This would also expand the domestic food supply, lowering food prices at home.

Conclusions

The economy of China enjoyed export-led growth for several decades. But weakening of the European economy has cut demand for Chinese goods in the short run.  Long-run prospects for China are brighter:   Low labor costs, a large working-age population, political stability, and an undervalued national currency encourage outsourcing to China.  Indeed, this helped it to avoid a substantial decline in output during the global financial crisis of 2008-9.  But aging of the population and increasing dissatisfaction of laborers induce many companies to outsource elsewhere.

By including the yuan in its basket for evaluating Special Drawing Rights, the IMF has underwritten the currency.  But its devaluation hinders exports by other countries and forces them to devalue.  In Central Asia, Kazakhstan had the largest depreciation, which stoked inflation.  Large countries will pressure China to strengthen the yuan; so Chinese growth, when restored, will likely be less oriented than before towards exports.  Nevertheless, China must improve its exports if it is to remain competitive with Southeast Asia countries that have cheaper labor.

In order to grow again, China has undertaken measures that will benefit the rest of the world, such as reducing pollution by substituting natural gas for oil and coal.  This will stimulate gas exporters like Uzbekistan and Turkmenistan. But renewed economic growth in China will not be enough to restore Central Asian economies to pre-crisis levels, since such factors as the relief for Iran from sanctions and the smuggling of oil by ISIL also decreased the prices of petroleum, natural gas and cotton. Central Asian economies should diversify.

China is likely to relocate some enterprises soon to Kazakhstan, creating diversification but also pollution here.  Unwilling to lose the benefit of good relations with its neighbors, Kazakhstan will most likely accept these environmental costs.  Allowing longer Chinese rents of farmland, however, is an even less popular policy.  President Nazarbayev has declared a moratorium, and he will have to face heated debates and protests before deciding for good.

Notes

Marc Labonte and Wayne Morrison (2016) of the US Congressional Research Service analyze recent trends in China’s exchange rate.

Platts is a global provider of information on energy, petrochemicals, metals and agriculture. 

ICIS provides information about the petrochemical market.

Dmitriy Belyanin has a Master’s degree of Business Administration in Finance and a Bachelor of Arts degree in Economics from KIMEP University.  Since 2007, he has been writing on issues in economics and finance ranging from stock markets to environmental economics. He is the associate editor of this blog.

  

References

Bloomberg News.  China leaders flag more stimulus after top economic meeting.  http://www.bloomberg.com/news/articles/2015-12-21/china-says-monetary-policy-must-be-more-flexible-as-growth-slows.  2015.

Brog, A., and Tanzy, K. Platts Report: China oil demand grows 10% year over year in August.  Platts.  http://www.platts.com/pressreleases/2015/100115b.  2016.

Buckley, C.  China ends one-child policy, allowing families two children.  The New York Times.  http://www.nytimes.com/2015/10/30/world/asia/china-end-one-child-policy.html?_r=0.  2015.

The Economist.  Rising Chinese wages will only strengthen Asia’s hold on manufacturing.  http://www.economist.com/news/briefing/21646180-rising-chinese-wages-will-only-strengthen-asias-hold-manufacturing-tightening-grip.  2015.

El-Erian, M.  The perils of China’s currency devaluation.  http://www.theguardian.com/business/2016/jan/13/perils-of-china-currency-devaluation-yuan-renminbi.  2016.

Gustke, Constance.  Pollution crisis is choking the Chinese economy.  http://www.cnbc.com/2016/02/11/.  2016.

Hsu, J.  Despite slowdown, China’s oil imports surge.  Market Watch.  http://www.marketwatch.com/story/despite-slowdown-chinas-oil-imports-surge-2016-03-07. 2016.

International Monetary Fund.  Chinese renminbi to be included in IMF’s Special Drawing Right basket.  http://www.imf.org/external/pubs/ft/survey/so/2015/new120115a.htm.  2015.

International Monetary Fund.  Factsheet - Special Drawing Right (SDR).  http://www.imf.org/external/np/exr/facts/sdr.htm.  2016.

International Monetary Fund.  October 2015 World Economic Database.  https://www.imf.org/external/pubs/ft/weo/2015/02/weodata/index.aspx.  2015.

Kaukenova, T.  The relocation of Chinese enterprises into Kazakhstan: Find out who benefits.  http://radiotochka.kz/6691-perenos-kitayskih-proizvodstv-v-rk-cui-prodest.html.  2014.

Kazakh Zerno.  Kyrgyzstan suffers losses from low prices in Kazakhstan.  http://kazakh-zerno.kz/novosti/agrarnye-novosti-kazakhstana/225815-kyrgyzstan-terpit-ubytki-ot-nizkikh-tsen-v-kazakhstane.  2016.

Kaznex Invest.  An analysis of the state of external trade in Kazakhstan. 1^st Quarter of 2015.  http://www.kaznexinvest.kz/napr/analytics/export/trade/Analiz_vneshney_torgovli_1_kvartal_2015.pdf.  2015.

Lee, X.  China’s weak natural gas demand cuts into LNG imports.  ICIS.  http://www.icis.com/resources/news/2015/10/07/9930658/china-s-weak-natural-gas-demand-cuts-into-lng-imports/.  2015.

MacLeod, C. Yuan hits a five-year low after China devalues again.  The Times.  http://www.thetimes.co.uk/tto/business/markets/china/article4658665.ece.  2016.

Ministry of Economy of the Kyrgyz Republic.  Analysis of foreign trade: External trade of the Kyrgyz Republic by country for January-December 2015.  http://mineconom.gov.kg/Docs/blanki/vneshetorgovyi_oborot_january-december_2015_.xlsx.  2016.

Morrison, W., and Labonte, M.  China’s currency policy: An analysis of the economic issues.  Congressional Research Service.  https://www.fas.org/sgp/crs/row/RS21625.pdf.  2016.

Murray, B.  Yuan real exchange rate undervalued 5%-10%, IMF report says.  http://www.bloomberg.com/news/articles/2013-08-01/china-s-real-exchange-rate-undervalued-5-10-imf-report-says.  2013.

Novosti Turkmenistana.  A new exchange rate of the Turkmen manat has been set.  http://infoabad.com/novosti-turkmenistana/ustanovlen-novyi-kurs-turkmenskogo-manata.html.  2015.  https://www.fas.org/sgp/crs/row/RS21625.pdf

OANDA. Average exchange rates.  https://www.oanda.com/currency/average.  2016.

Observatory of Economic Complexity.  Tajikistan.  http://atlas.media.mit.edu/ru/profile/country/tjk/.  2013.

Parija, P.  China curbing cotton imports as top user buying more yarn.  Bloomberg News.  http://www.bloomberg.com/news/articles/2015-12-08/china-importing-less-cotton-is-bad-news-for-prices-council-says.  2015.

ProFinance Service.  The aluminum market: A large re-melting.  http://www.forexpf.ru/news/2015/08/15/axtm-rynok-alyuminiya-bolshaya-pereplavka.html.  2015.

Shaffer, L. China’s PMI surveys show recovery in manufacturing.  CNBC.  http://www.cnbc.com/2016/03/31/.  2016.

Shanghai Daily.  China introduces pro-growth measures to arrest economic slowdown.  http://www.shanghaidaily.com/national/China-introduces-progrowth-measures-to-arrest-economic-slowdown/shdaily.shtml.  2016.

The World Bank.  World Development Indicators: Personal remittances, received (% of GDP).  http://data.worldbank.org/indicator/BX.TRF.PWKR.DT.GD.ZS. 2015.